Product Market Competition and Gender Discrimination
Cooke, D; Fernandes, AP; Ferreira, P
Date: 22 November 2018
Journal
Journal of Economic Behavior and Organization
Publisher
Elsevier
Publisher DOI
Abstract
This paper presents novel empirical evidence for the prediction from Beckerís (1957)
famous theory, that competition drives discrimination out of the market. We use a comprehensive
business registration reform in Portugal as a quasi-natural experiment to study the
e§ect of increased product market competition on gender discrimination. ...
This paper presents novel empirical evidence for the prediction from Beckerís (1957)
famous theory, that competition drives discrimination out of the market. We use a comprehensive
business registration reform in Portugal as a quasi-natural experiment to study the
e§ect of increased product market competition on gender discrimination. We use employeremployee
data for the universe of private sector Örms and workers, and exploit the staggered
implementation of the reform across municipalities for identiÖcation. Increased competition
following the reform increases growth of the female employment share and reduces the
gender pay gap for middle-managers and for medium- and high-skilled workers but not for
top-managers or the unskilled. We also Önd that discriminatory employers, approximated
by a low female employment share, are more likely to exit and those that survive reduce
overall employment growth following the reform, while non-discriminatory employers grow
faster. Existing evidence has shown that gender discrimination reduces output; our Öndings
suggest that entry deregulation can contribute to reduce ine¢ ciencies arising from gender
discrimination.
Economics
Faculty of Environment, Science and Economy
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